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Gov’t gives green light to 90-day waiting period for auto-enrolment

The Government has announced that employers will be allowed to operate a 90 day waiting period before they need to auto-enrol staff into a private pension scheme after 2012.

As tipped by Money Marketing last month, this will be allowed in exchange for making higher contributions into the scheme.

A defined contribution scheme will need to have a total contribution of at least 11 per cent of a band of earnings, with the employer paying at least 6 per cent to take advantage of the three-month waiting period.

Employers using the personal accounts scheme will not be able to postpone automatic enrolment.

Standard Life senior pensions policy manager Andrew Tully says: “This is good news for generous employers. The ability to postpone auto-enrolment for ninety days gives employers a real incentive to make sure their pension contributions are, at least, 6 per cent of band earnings. We want to work with employers over the next few years to see if they will be able to make use of this exemption.”


Eadon sets up release firm

Ex-PFS chief executive Tim Eadon has launched a new IFA firm, Better Retirement, specialising in equity release.


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